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rategies and structures. 4) Strategic management and strategic human resource management integrate the separate HRM functions. 9 Figure Traditional and Strategic Views of HRM (b) HRM The Strategic View 10 Table Theoretical Perspectives on SHRM 11 Competitive Advantage Through Human Resources Basic thesis: Effective utilization of HR can assist organizations in achieving petitive advantage. Competitive advantage: a. Refers to the ability of an organization to formulate strategies to exploit profitable opportunities (., maximizing its return on investment). b. Perceived customer value can create petitive advantage. 12 Competitive Advantage Through Human Resources C. Offering a product or service that is unique can create petitive advantages. 4 sources: 1. Financial or economic capital capability. 2. Physical capital capability. 3. Human capital capability: Composition of workforce 4. Organizational capability: The firm’s ability to manage people D. Key issue for organizations is to achieve alignment among their various functions and be flexible in responding to their environment. 13 Strategic HRM HRM as a petitive advantage involves strategic human resource management